Inference

One factor in low productivity is the amount of time wasted by workers. Wasted time includes time spent cleaning up mistakes, waiting for more material and equipment, and performing any other activity not related to production. In a project designed to examine the problem, an operations management consultant took a survey of 200 workers in companies that were classified as successful (on the basis of their annual profits) and 200 workers from unsuccessful companies. The amount of time (in hours) wasted during a standard work week was recorded for each worker. These data are stored in column 1(successful companies) and column 2 (unsuccessful companies) file productivity

a. Do these data provide enough evidence at the 1% significance level to infer that the amount of time wasted in unsuccessful firms exceeds that of successful ones?
b. Estimate with 95% confidence how much more time is wasted in unsuccessful firms than in successful ones.

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Solution Summary

One factor in low productivity is the amount of time wasted by workers. Wasted time includes time spent cleaning up mistakes, waiting for more material and equipment, and performing any other activity not related to production. In a project designed to examine the problem, an operations management consultant took a survey of 200 workers in companies that were classified as successful (on the basis of their annual profits) and 200 workers from unsuccessful companies. The amount of time (in hours) wasted during a standard work week was recorded for each worker. These data are stored in column 1(successful companies) and column 2 (unsuccessful companies) file productivity

a. Do these data provide enough evidence at the 1% significance level to infer that the amount of time wasted in unsuccessful firms exceeds that of successful ones?
b. Estimate with 95% confidence how much more time is wasted in unsuccessful firms than in successful ones.